Economic Encounters of the Plural Kind

Archive for April, 2012

This weekend, Duke University hosted the annual conference of the journal History of Political Economy. This year’s topic was “The Economist as Public Intellectual,” and papers explored how economists become influential in policy and public debates, how they navigate the public sphere, and how influence or are influenced by various media formats. For those interested, selected papers will appear in the annual supplement to History of Political Economy.

The topic is fascinating and extremely important. However, here I only want to share one quote from 20th century public intellectual Walter Lippman. As an undergraduate at Harvard, Lippman took some courses in mainstream economics but was largely unimpressed: he did not see usefulness in such models of economic behavior. One aspect that he reacted to was the assumption, still largely used today, that economic analysis takes preferences as exogenous and given. Lippman found this assumption bewildering, writing that “Advertising is in fact the weed that had grown up because the art of consumption is uncultivated.”

I had not previous considered consumption as an art, but this might be a good way to think about it to make sense of the “mindless consumption” that some modern commentators make on our consumption-driven society.

If you think that the pharmaceutical industry is lucrative, imagine taking those few regulations and safeguards of human health away. Hand over complete discretion to the profit-oriented corporations to conduct clinic trials to whatever extent they please; to market their products without any limitations; to “educate” consumers about various uses of their drugs before demonstrating effectiveness. There are often trade-offs between maximize health and maximizing profits; without any regulations, you can imagine which path shareholder-beholden companies take.

This essentially describes the livestock pharmaceutical industry. Without any regulations and no risk of lawsuits being filed by “patients,” livestock pharmaceutical companies take bold risks and make profit-maximizing decisions at the expense of both animal and (indirectly) human health. It is extremely lucrative.

So I am taking this small victory of the U.S. FDA’s requiring prescriptions for livestock as a chance to return from a blogging hiatus. It is a small step, but the situation without any regulatory framework has become so precarious for human health that not even the drug companies were willing to fight this battle:

Farmers and ranchers will for the first time be required to get a prescription from a veterinarian before using antibiotics in cattle, pigs, chickens and other animals, federal food regulators announced on Wednesday. Officials hope the move will slow the indiscriminate use of the drugs, which has made them increasingly ineffective in humans.

Open Economics

This blog is administered by a group of students and alumni from the University of Notre Dame who are interested in engaging and debating the world of economic phenomena we face, everywhere and everyday.
Disclaimer: Opinions expressed herein are the authors' own and not those of any organizations or employers to which they are attached.